Nos. 610 and 636 January Term, 1977, Appeal from Decree of July 29, 1977 and Decree of August 3, 1977 entered by the Court of Common Pleas, Orphans Court Division, County of Chester at No. 1976-232.
Herbert J. Bass, Fox, Rothschild, O'Brien & Frankel, Israel Packel, Philadelphia, for appellant.
John G. Shea, Bryn Mawr, for appellees, Charles B. B. Penrose, et al.
Dallett Hemphill, West Chester, for appellees, First Pa. Bank, et al.
Noah D. Cutler, Radnor, for appellee, James W. Keeley, Jr.
Israel Packel, Philadelphia, for R. & R. Investment Corp.
Eagen, C. J., and O'Brien, Roberts, Nix, Manderino and Larsen, JJ.
Boies Penrose died on February 27, 1976. His estate included real property in Chester County consisting of his residence, other improvements, and forty-four acres of land. On June 30, 1977, the executors of his estate entered into a written agreement for the sale of the realty to the R. & R. Investment Corporation ("R. & R.") for $512,500. The agreement of sale was subject to several conditions including governmental approval of a subdivision plan, the issuance of building permits, and the availability of a 98% four-year mortgage at a rate of interest not to exceed 10%. The agreement also expressly provided that the sale was contingent upon the approval of the orphans' court.
On July 8, 1977, the executors filed a petition for approval of the sale to R. & R. in the Court of Common Pleas of Chester County, Orphans' Court Division. Charles Penrose and Frances Penrose Haythe, the son and daughter of decedent who share a life interest in his estate, objected to the proposed sale claiming inter alia that the executors were in receipt of a more favorable offer from James Keeley. Keeley offered to purchase the realty for $550,055, subject to a subdivision contingency but not a mortgage contingency. After an evidentiary hearing the court on July 29 refused to approve the sale to R. & R. Its decree fixed August 2, 1977, as the date on which the court would receive additional bids for the property and directed that the property would be "knocked down to that bidder making the highest, least conditional offer accompanied by a deposit equal to five percent of the bid price." In the court proceeding, the Barbados Hill Corporation ("Barbados"), a company owned entirely by Charles Penrose, made a bid of $543,052.80 without mortgage or subdivision contingency. On August 2, 1977, the court determined that this was the best bid and upon the conclusion of the "auction," the executors entered into an agreement of sale with Barbados. On the same day the executors filed a motion requesting the court's approval of the proposed sale and on August 3, 1977, the court approved the sale.
R. & R. filed this appeal from the July 29 and August 3 decrees contending that the court's disapproval of the proposed sale to it and the court's approval of the sale to Barbados were both in error. R. & R. argues that the court's rejection of the R. & R. agreement was improperly based upon a consideration of a higher offer which, R. & R. claims, arose after the execution of the agreement with R. & R. Additionally, R. & R. complains that the orphans' court was without authority to order an auction of the property. The executors and Charles Penrose, ...